Indiana TechTech & Business Articles Contributed by the IU Student Community

Digital Ways to Earn Money in the Digital World: Cryptocurrencies in the Spotlight

In the digital age of things, money is more accessible than it has ever been. Digital money is circulating through thousands of globally distributed financial markets every day, creating wealth and opportunities for millions of people. Cryptocurrencies have also become popular tools for investment for some and they signal further developments in the field of digital global finance. For those interested, the media is always covering issues related to such currencies while visiting a cryptocurrency blog will surely increase chances of profiting by introducing crucial concepts and techniques to the investor. Wariness always pays off when the issue is money and such interested individuals should most definitely educate themselves about cryptocurrency mining and its possible consequences for the incautious investor.

Google and Facebook, the two largest internet giants of today’s world, have taken notice of adverse possibilities surrounding the issue and decided to ban all cryptocurrency advertisements on their platforms. Following Facebook’s recent policy shift, Google also became worried about control over the actions and policies of cryptocurrency sellers and chose to ban their advertisements until the necessary legal framework is established. According to the company’s Director of Sustainable Ads Scott Spencer, the products being displayed are “unregulated” and “speculative”, thus posing a threat to the company’s user security policies. Facebook previously had decided to ban such advertisements after receiving user complaints in the name of preserving user trust in its services while Google previously had a hard time defending such ads, due to their objectionable content. The Initial Coin Offerings (ICOs) seem to be the main problem as such tools offer investors a certain amount of share in an upcoming cryptocurrency without further information made available. More than 900 ICOs were carried out in 2017 to raise several billions of dollars but the Securities and Exchange Commission was not pleased at all, stating that ICOs are considered as securities offerings in legal terms and unregistered applications are violating financial law.

The very fundamentals of the Bitcoin frenzy are being questioned and challenged by some researchers and Robert Kuttner of Huffington Post makes valid points in his article titled “The Bitcoin Hoax”. The author refers to Bitcoin as “an unholy alliance between cyber-utopians, money-launderers, financial fraudsters and ultra free-marketeers” and points out that the high price tags for its coins make no contribution to economic development. Kuttner also finds the claim that Bitcoin operations leave no trails suspicious, emphasizing the place of cyber terrorism in today’s world, while associating Bitcoin’s ‘no fees policy’ with mindless economic liberalism. The supposed $21 million Bitcoin amount also draws the author’s attention as he believes that due to several competing firms and their speculative methods, the real number is much higher. Kuttner dives into the US history to state that American banks were allowed to create as much credit as they wished during the 19th century but the results were catastrophic for the markets in the decades to come, realizing that Bitcoin’s modus operandi is eeringly similar. The author also correlates the 2008 crisis with the newly introduced and massively popular tech-based investment tools of the Reagan Years of the 1980’s, claiming that it took 20 years for their toxic effects to substantialize. Kuttner believes that lack of governmental regulation will make it virtually impossible to control the Bitcoin market and the popularization of its products will harm local markets, including those of the United States.

Naturally, the issue has significant political ramifications as well and China’s domination over the Bitcoin market is seriously concerning American authorities, including the President himself. Chinese mining pools are currently controlling more than 70% of the global Bitcoin network’s processing power while the Bejing-based Bitmmain Technologies is currently “mining more than half the world’s bitcoins”. The White House took notice of the situation and is currently working with the Ripple Labs to counter China’s such dominance in the markets as lack of regulation over such financial instruments might have catastrophic effects on American financial markets. China also enjoy low electricity prices and has managed to establish massive mining farms, not to mention significant production capabilities for cryptocurrency mining equipment. Ripple’s own coin ‘XRP’ is largely owned by the company itself and therefore the system is not de-centralized like its competitors which has raised concern regarding its capability to compete with the Chinese rivals. Ripple Labs has a prior history with American politicians, with former US president Bill Clinton publically speaking of the company’ services while the company is currently investing into three new financial services for its products, enjoying a recent price increase for its coins by 100% in September. The company is looking forward to working with the American government and appreciates its officials’ open-mindedness and encouragement regarding the issue.

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